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Last Updated : Feb 13, 2017 02:13 PM IST | Source: Moneycontrol.com

Buy Bharat Forge; target of Rs 1150: ICICI Direct

ICICI Direct is bullish on Bharat Forge has recommended buy rating on the stock with a target price of Rs 1150 in its research report dated February 09, 2017.

 
 
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ICICI Direct's research report on Bharat Forge


BFL witnessed a steep decline in non-auto business & moderation in demand in class 8 truck segment (34% of exports) in the export market in FY16E. The class 8 truck net order fell 33% YoY in FY16. The company has guided the CV market will decline 5-10% in CY17.


Outlook


Despite near term challenges, we remain upbeat on the long term growth potential of the company, which remains the largest forgings company in the world, with strong engineering capabilities. Thus, we value BFL on an SOTP basis with standalone business at 26x FY18E EPS of Rs 41.4 and other subsidiaries at Rs 75/share to arrive at a target price of Rs 1150. We ascribe a BUY recommendation to the stock.

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First Published on Feb 13, 2017 02:13 pm
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